Accounting
"Accounting is the art of documenting, categorizing, and summarizing in a substantial
manner and in terms of money, transactions and occurrences that are in part, at least,
of a financial nature, and evaluating the consequences thereof," according to the
Accounting Standards Council (ASC).
According to this definition, accounting's purpose is to provide quantitative information
about a company so that economic judgments and resolutions may be made.
"Accounting is a service activity," says another definition. Its purpose is to give
quantitative information on economic entities, mainly of a financial character, in order to
aid in making economic decisions—in making rational choices among various courses
of action."
The process of methodically keeping a record of all business transactions, either
manually or electronically, in chronological order or according to the date of occurrence
is known as recording or bookkeeping measurements.
Sorting or arranging similar and connected transactions into their appropriate classes is
known as classifying measurements. Posting to the ledger is how classification is done..
Summarizing Measurements is the preparation of financial statements which include
the following:
1. Statement of Consolidated Income
2. Statement of Changes in Capital
3. Statement of Financial Position
"Accounting is the art of documenting, categorizing, and summarizing in a substantial
manner and in terms of money, transactions and occurrences that are in part, at least,
of a financial nature, and evaluating the consequences thereof," according to the
Accounting Standards Council (ASC).
According to this definition, accounting's purpose is to provide quantitative information
about a company so that economic judgments and resolutions may be made.
"Accounting is a service activity," says another definition. Its purpose is to give
quantitative information on economic entities, mainly of a financial character, in order to
aid in making economic decisions—in making rational choices among various courses
of action."
The process of methodically keeping a record of all business transactions, either
manually or electronically, in chronological order or according to the date of occurrence
is known as recording or bookkeeping measurements.
Sorting or arranging similar and connected transactions into their appropriate classes is
known as classifying measurements. Posting to the ledger is how classification is done..
Summarizing Measurements is the preparation of financial statements which include
the following:
1. Statement of Consolidated Income
2. Statement of Changes in Capital
3. Statement of Financial Position
